Coal & China Factor
Shares of coal producers and mining contractors gained significantly in the past few trading days. Trading volume has also increased substantially including in the troubled company Bumi Resources (BUMI) and debt-ridden Delta Dunia Makmur (DOID). Reports from China might continue to support the sector for quite sometime.
Speculations on Kangean Block
Kangean block in East Java is one of the largest gas producing fields in the country, feeding manufacturing and power generation companies in the area. It is co-owned by Mitubishi Corp, Japan Petroleum Exploration (Japex) Ltd, and Energi Mega Persada (ENRG)—-member of Bakrie Group.
Rumours on Apexindo & Elnusa
Apexindo Pratama (APEX), an oil and gas supporting services company, suffered net loss of US$7.35 million in the first half of 2016 as sales revenues collapsed 51.2% to US$71.3 million. Elnusa (ELSA), another supporting services company, on the other hand, booked net profit of Rp145 billion, an increase of 9.2% from the same period of 2015, while sales revenues slipped only by 5.1% to Rp1.71 trillion (US$132 million).
Rally of Commodities
Shares of palm oil producers opened mixed in the region Wednesday (Oct 12) despite 3% gain of crude palm oil (CPO) in the futures market Tuesday. Felda and Sime Darby down 0.85% and 0.38% respectively in Kuala Lumpur, while First Resources lost 0.8% in Singapore. In Jakarta, most plantation shares were in green, but modest gains.
No Policy U-Turn for Nickel
Acting minister for energy & mineral resources Luhut Binsar Pandjaitan, one of trusted aides of President Joko ‘Jokowi’ Widodo, said the government has dropped a plan to resume export of nickel ores to protect investments in the domestic processing facilities (smelters).
Rally of Commodities
Energy stocks gained worldwide Monday (Oct 10) as WTI crude oil jumped 3.1% to US$51.35 per barrel, the highest closing value since July 2015. ExxonMobil and Chevron gained 1.96% and 1.67% respectively in New York, while BP advanced 1.74% in London. Santos Ltd followed with almost 5% gain in Sydney this morning.
New Nickel Smelter Starts Commercial Operation in Obi Island, North Maluku
Nickel returned to US$10250/ton in London Metal Exchange (LME) last Friday after dropping to below US$10,000 earlier due to negative sentiments from possible relaxation of mineral ore exports by Indonesian government. Nickel stockpile in LME continued to decline to its new low, supporting the price. But, even if the export ban will be kept, nickel supply from Indonesia is poised to grow in the coming months.
Commodities-Related Stocks
Commodities regained grounds worlwide Thursday to follow crude oil. Nickel, for example, returned to above US$10,000/ton, while tin closed at US$20,200/ton in London Metal Exchange (LME). Aneka Tambang (ANTM), Vale Indonesia (INCO), and Timah (TINS) opened higher on IDX Friday (Oct 7) accordingly.
Revisiting Delta Dunia Makmur
Delta Dunia Makmur (DOID), the coal mining contractor, is among the best performing stocks with 411% gain year-to-date. The Company is in the process of issuing up to US$500 million Notes on the Singapore Exchange (SGX-ST) to refinance existing debentures. Recent rally of thermal coal prices might help.
Wild Speculations on Medco Energi
We’ve heard lots of rumours surrounding ownership of Medco Energi Internasional (MEDC) in the past few months. Rumours intensified in recent weeks about changes of ownership in the controlling entity of MEDC related to acquisition of Newmont Nusa Tenggara (NNT), proposed acquisition of ConocoPhillips’ asset in Natuna, participation of Medco in acquisition of Chevron’s geothermal assets, and competition in the giant 1600 MW gas-fired power plant Jawa-1 project.